The 4 Steps to getting filthy wealthy with real estate
ฝัง
- เผยแพร่เมื่อ 27 ส.ค. 2024
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STEP 1: Watch my case study on creative hosting 👇🏽
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*All content on the Robuilt TH-cam channel reflects my own opinions and should NOT be taken as legal advice, financial advice or investment advice. Please seek out the guidance of professionally trained and licensed individuals before making any decisions. Some links in the description may be affiliate links.
Thank you Rob for not doing the unnecessary editing with stock footage and annoying jump cuts and captions. Just good raw information is what I like without unnecessary post production.
One of the best videos you've done. No hype...just a story and facts
I like the unedited content , good real change of “pace”
I bought a house in 2008 and it had a 5 year arm. So, the payments went higher year after year but my salary didn’t grow enough to keep up. I tried renting arbitrage and was unsuccessful. So in 2013 the house was actually worth less than purchase price and at less than what I owed. Lost everything. I have since been following Rob’s plan and methods and I was able to save $$$ and purchase a new home and it’s doing great now. Thank you Rob for all that you do.
Great lesson! I just bought my first STR last year with cash flow in mind. But Ive learned more and more about the other benefits of real estate. Definitely a long term playThanks for all you do! 💵😊
My advice to people - (might go against some bigger pockets advice) - only buy houses you love. If you buy what you love youll enjoy the journey so much more. (Obviously make sure the numbers work though). Sometimes we get too wrapped up in best investment decision.
You are an extremely gifted storyteller. I know all of this and knew what was coming but it’s always good to hear again and in trying to explain this to anyone else is difficult. It comes from a generosity. It’s a totally separate skill from real estate chops. I hope you understand that and it continues to serve you. Great video.
This was so helpful to see the calculations from the stages of buying the property to selling it. It was also helpful to hear your personal story along with it and review a real life scenario with a property you own. Please make more of these videos! Thank you!
I like the unedited format
100% accurate. I got in during the covid scares when people were terrified housing was going to bust. Now I have a great white board story 4 years later
1:16 someone got a new gadget 😅
Concise, helpful content
Thanks for the free lesson! Appreciate it.
I think I only missed couple of reason why it's better :
For buying more houses?
Boasting the right way with house owners?
The tax part was something I didn't know, not sure if that will apply for me in my country
Really helpful breakdown - love the format. One note - it was a little hard to see some of your numbers so I zoomed in. I think with the camera straight on you and a white board instead of angled, it might work well. Love it - thanks for the continued educational and entertaining content!
Love the video, incredible how you can make a loan video and basically make no mistakes. 😅 Thank you for sharing.
One little suggestion, don’t forget to add the closing cost to the down payment to make it more realistic. Here in Miami closing cost are 6% of the purchase price. Plus vacancy, repairs, etc.
I think that for the purpose of the video showing the framework makes sense, but it might give people an unrealistic expectation of how much money is needed to purchase and maintain a property.
Great video format!
Thanks for sharing these fundamentals Rob
MISTAKE! - Hey Rob I like your content a lot. But, I think there's a mistake in here: you cannot simply add 1) and 3) as benefits on top of one another. While you are still paying your mortgage, you will be using (directly or indirectly) the cashflow from 1) for the paydown shown in 3). I.e. you are double-counting the Paydown amount. Cheers :)
The power of real estate explained in a small white board
Just do both. Arbitrage some for cash flow and purchase others for the wealth benefits.
Problem solved.
Good format
Great video! Thank you so much and I appreciate the encouragement
Example: if I have $100,000 in taxable income at a 30% tax rate I would owe $30,000 in taxes. If I had a deduction of $50,000 that would mean I instead owe $15,000 in taxes $50,000 x .3). That’s $15,000 more to my net worth, not $50,000.
He didn’t explain in that in the video but he did do the math you outlined to come up with the actual $ amount savings after reducing his taxable liability. His actual deduction was $184,204
I love this format much more lol. The other makes me anxious lol
This is interesting and all. what is left unsaid : that if you are using leverage) financing. Can you really say you own the asset? If Everything goes down the crapper, the bank is coming after their asset. It really isn't yours until you pay for the whole thing
So after you get the equity...is HELOC the property a bad idea?
Brilliant! Thank you for sharing.
The wealthiest are in commercial real estate, where cash flow is king. Next!
After watching this video, I finally realized that cash flow is king 🤴
I like this video. Thank you.
Loved this video keep it up!
Love your videos and the knowledge you're spreading. While everything you state is true, I unfortunately have to temper the numbers a bit. The gains are still huge, but don't account for: 1. The income you make from rent is taxable income, so you don't capture the full amount. 2. I wonder if the cash flow you mention from rent accounts for property tax, insurance and repairs? 3. When you sell that property, deduct 15% in capital gains on the increased value. 4. The five yrs you saved ~25K in depreciation will get taxed at 25% upon sale. Again, still a great net gain, but there are some dirty details that put enough of a dent in profits that they should not be overlooked.
So does this kind of explain why some people are saying buying negative cashflow properties isnt a terrible thing if you can subsidize it somewhere else?
Great video Rob! Thank you for sharing. But how do you go from 1 property to 10? Would banks/private lenders lend you money for the 2nd, 3rd, and so on… Don’t you need to have >$150K income for them to lend you the money for those properties?
Great explanation.
Without the cash flow you wouldn't have any other benefits. That's how you keep the property.
1. Is it possible to get cashflow of $2000 in 2024? Sounds ridiculous.
2. Home equity increase due to appreciate and paydown is taxable on selling, so you do not increase your net worth the same amount directly by selling the house but probably with 1031 exchange and increase in cashflow but again it all depends on your particular numbers.
3. Not sure what was your mortgage interest rate and downpayment, but average amortization table will give you around 31-32K of equity paid, not 61K in 5 years.
4. 68K tax benefits amount was deducted year 1 as write off or that was the exact amount saved which again not possible since even let's say land only cost 80K than rest of building 600K. I could do cost seg study and deduct 30-35% at most which is close to 200K and if our tax bracket is 32% or 36% it still won't end up as 68K of not paid taxes.
Thanks, man! Great freakin' video! 🎉
Great video. One minor issue though. The tax benefits are deductions not tax credits, so a $1 deduction isn’t $1 back in your pocket. It’s actually a fraction of that because it simply reduces the taxable income.
Yes, you are 100% correct here. I had already done that calculation ahead of time. So the total deduction on that home was $184,204 with a cost segregation report (because of the short-term rental loophole). Multiply that by my tax rate (37%) and that's how I got to the $68,155 figure I referenced. I realize that probably wasn't super clear. But hopefully that clears it up!
WHAT ABOUT RECAPTUTRING THE DEPRECIATION?
Do you think this is still viable if you have negative cash flow? I just don't think I can rent my place for the mortgage but want to keep the property for equity and paydown of the loan (I can cover the delta of the negative cash flow).
Thanks Rob
Except then your tenant calls you because they invited a friend over and the friend’s mother is now there as well and all of a sudden they are claiming to be tenants and the police refuse to get them out and the tenant is scared to even go home because they have become violent. Then those tax benefits don’t look as good 😂 We got them out but I kind of want to sell and never go through that again!
What other loan can I get like a fha one ? Because I already got a fha loan 2 years ago and that’s the house I live in that I’m not selling so I want to go to the next without selling this one
With the accelerated depreciation, don’t you end up in a few years where there isn’t any depreciation left?
Yes it's a catch. That is definitely a long term goal otherwise you pay a penalty. But, if it's for wealth purposes then it shouldn't be a problem
When that happens, performing a major home improvement project/addition restarts the clock!
thanks rob
Yes, very clear!
Those of us who bought pre-pandemic, got super lucky, probably will never happen again, but 3% appreciation is awesome!
I bought in Joshua Tree in 2017 for $450,000, house today is probably worth a little bit more than double that. In the last five years, have probably netted about $150,000 in profit, my principal has been paid down about $50,000 and yes, gotten some depreciation. Best, most lucky investment of my life. so, I’ve probably increased my net worth by $500,000 with about $100,000 initial investment and I’ve had a lot of fun hosting in the meantime.
Priceless
This is my same story. One. At. A. Time. Slowly. Then suddenly bigger, faster, more agile
Are there any companies that lend on Greenfield ground lease income? There's so many who only seem to do houses.
I like the openness of the breakdown, but it doesn't consider loan interest, specifically how front-loaded the interest vs principal loan paydowns are. No way a person can pay down 68k in principal of the loan in 5yrs. Details like that can turn a deal pear shaped quick.
That was the exact calculation for my $624,000 home at 3.25% 🤷🏽♂️
Right on then! My mistake, carry on...
@@Robuilt
Hey Look its Rob Lopez
How are you counting depreciation as money in your pocket???? Let alone you did the same thing with appreciation...... Both are not money in your pocket.
i don"t want to be a stickler but 20k a year for 5 years = $100k
While this direct no nonsense approach was fitting given the subject matter of this presentation, I actually enjoy the razzmatazz of your videos. You are not Professor Vanilla. Stay true to yourself, Rob. However, if you do another vid like this one, get a new marker. 😂
Uh oh, you fired Caleb didn't you? 😢
Lets goooo Rob
Just cash flow 2gs a month and build equity at 3% a year. Simple. Do this 10x to be rich lol
He's renting out a house worth 600k-1mil for only $2000 a month? Am I missing something??
Yes, he is profiting 2K monthly the rental rate is much higher.
And it helps if your Dad lends you 30k and if you dont have a wife outspends your saving.
Are you taking into account your property taxes$$$$ if you bought at $624k your property taxes are $7000 per year and it keep rising...so you paid in 5years is $35-$40 thousand in property taxes😅😅😅😅
❤
The paydown is incorrect, the first five years of a 30 year amortization schedule is mostly interest. Then when you sell it within 5 years, the brokers take most of your equity through fees, depending on where in the RE cycle you sold. You also don't equate for vacancies, property taxes and general maintenance. This is basically a fluff piece to lie to your YT audience. Get realistic.
It’s definitely possible and not fluff.
I’m doing it myself so I can attest what he’s saying works.
The cash flow he’s estimating is higher because he’s more focused on STR/airbnb rentals which can command much higher rental incomes if you market and set up the property correctly.
I would also assume his expenses account for vacancies and capex for maintenance etc.
Beyond the cash flow, all the other benefits of appreciation, debt pay down and tax savings are very real and ultimately contribute to your net worth over time.
@@Axertionnot with the "loopholes" he's describing - he's double dipping for depreciation and appreciation & inflating the two.
No he isn’t. You can depreciate real estate improvements and the property can still appreciate in value.l due to the area.
If you spend $50k on a new kitchen that kitchen will lose value over time. In 20-30 years that kitchen will be outdated and will need to be remodeled again to regain its value.
That doesn’t mean the area and inflation won’t cause the overall property value to appreciate at the same time the kitchen is losing its value.